Foreign companies, when setting up business in Australia, are required to appoint one resident director if they are a proprietary company or two resident directors, if they are a public company.
As part of the regulations set out by the Australian Corporations Act 2001, a resident director (also known as nominee director), must reside in Australia. Foreign companies often find it difficult, to not only appoint a suitable resident director that has the skills and knowledge of Australian regulations, but also one that lives in Australia.
This is where resident director services fit in and could be a viable option for your business to consider. Most resident director services include all the compliance activities that are required to be performed by a local director –
- Incorporation of your Australian entity, including Australian Tax office setup and ASIC regulatory requirements, if required for new business set ups.
- The ongoing management of and signing of documents for on time lodgement with regulatory authorities.
- Liaising with and being the contact person for regulatory authorities and financial institutions.
- Acting as the shareholders representative to ensure appropriate compliance procedures are held.
The appointed third party resident director usually will only oversee compliance, ensuring all regulatory requirements have been administered and reporting to head office. They do not run the Australian entity.
There are several reasons and benefits when you should consider engaging resident director services for your Australian entity and these include –
- Compliance with the Australian Corporations Act 2001
This is the most important reason for the benefits of utilising resident director services. You can relax and get on with the business of business knowing the appointed resident director meets residency compliance.
- Maintain confidentiality
By appointing a third-party resident director, you can maintain your privacy, especially in circumstances where the corporate registers are publicly available. Whether you do not want your name on the register for personal reasons or business interests such as not wanting your competitors to know you are setting up in Australia, your interests will remain confidential.The resident director services are also useful in situations where you want a professional name on the register to represent your company.
- Cost-effective solution
Utilising resident director services is a less expensive option than employing a full-time or even part-time director to the business, especially when you add the costs of employment such as superannuation, workers compensation and payroll tax, if relevant. Foreign companies in Australia already have big expenses setting up and growing their business. This is a cost-effective way to ensure your Australian entity meets compliance whilst you retain managerial control of your business.
- Can provide other services on an as-needed basis
Particularly when you choose a professional accounting firm like Abdera, who offer many accounting, upper level financial officer and virtual CFO services to help your business when the need arises.
- Can assist with new subsidiary bank opening
With the updated Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act), opening a new bank account for your Australian subsidiary comes with several complexities. Appointing resident director services can smooth the transaction and ensure all the paperwork and compliances are completed, stress-free.
Looking for a suitable resident director for your business? Our directors have had background, police and credit checks, ready to get your business into business!
Partner with us by calling our office on +61 2 8916 6259 or contact us here.
There’s more help!
Read more about what our resident director services include and how we can help you take off in Australia.
Do you have more questions about resident director requirements? Here is our blog ‘FAQs on resident director services’ you may find useful.